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Business Taxes Law Guide—Revision 2024
Sales And Use Tax Law
Revenue and Taxation Code
Division 2. Other Taxes
Part 1. Sales and Use Taxes
Chapter 1. General Provisions and Definitions
Section 6015
6015. "Retailer." (a) "Retailer" includes:
(1) Every seller who makes any retail sale or sales of tangible personal property, and every person engaged in the business of making retail sales at auction of tangible personal property owned by the person or others.
(2) Every person engaged in the business of making sales for storage, use, or other consumption or in the business of making sales at auction of tangible personal property owned by the person or others for storage, use, or other consumption.
(3) Any person conducting a race meeting under the provisions of Chapter 4 of Division 8 of the Business and Professions Code, with respect to horses which are claimed during such meeting.
(b) When the board determines that it is necessary for the efficient administration of this part to regard any salesmen, representatives, peddlers or canvassers as the agents of the dealers, distributors, supervisors, or employers under whom they operate or from whom they obtain the tangible personal property sold by them, irrespective of whether they are making sales on their own behalf or on behalf of the dealers, distributors, supervisors, or employers the board may so regard them and may regard the dealers, distributors, supervisors, or employers as retailers for purposes of this part.
(c) Notwithstanding subdivision (b), a newspaper carrier is not a retailer and the retailer is the publisher or distributor for whom the carrier delivers the newspapers. The publisher or distributor is responsible for the tax measured by the price charged to the customer by the carrier.
History—Stats. 1943, p. 2455, operative July 1, 1943, deleted provisions relating to meals served students and employees, related provisions being enacted as Section 6363. Stats. 1943, p. 2620, operative July 1, 1943, added (c). Stats. 1949, p. 1344, operative July 1, 1949, substituted "Every seller who makes any retail sale or sales of tangible personal property, and every person engaged" for "Every person engaged in the business of making sales at retail or" in (a) and "Chapter 4 of Division 8 of the Business and Professions Code" for "Chapter 769, Statutes of 1933, as amended" in (c). Stats. 1991, Ch. 85, in effect June 30, 1991, operative July 1, 1991, lettered the former first and second paragraphs as subdivisions (a) and (b), respectively; renumbered former subdivisions (a), (b), and (c) as paragraphs (1), (2), and (3), respectively; substituted "the" for "such" after "on behalf of", in subdivision (b); and added subdivision (c).
Note.—Section 14 of Ch. 88, Stats. 1991, states that the provisions of Section 6359.5 shall become operative on July 15, 1991.
Trustee in Bankruptcy as "retailer."—A trustee in bankruptcy who is selling the physical equipment of the bankrupt business, but is not conducting or continuing such business, is not a "retailer," and is not subject to payment of sales tax upon sales made by him in liquidation of the assets of the bankrupt estate. State Board of Equalization v. Boteler (1942) 131 F.2d 386; California State Board of Equalization v. Goggin (1951) 191 F.2d 726, cert. den. (1952) 342 U.S. 909. But see Debtor Reorganizers, Inc. v. State Board of Equalization (1976) 58 Cal.App.3d 691, summary following Section 6201.
Optometrists.—An optometrist who supplies glasses to his patients is a "retailer," and is required to pay sales tax on such portion of his charges as represents the fair retail value of the glasses. Kamp v. Johnson (1940) 15 Cal.2d 187. See, however, Section 6018, under which optometrists are consumers on and after September 19, 1947.
Contractor.—Sales and use tax ruling 11 (now regulation 1521), which provides that contractors are retailers of "fixtures" which they furnish and install, is valid. General Electric Co. v. State Board of Equalization (1952) 111 Cal.App.2d 180; Honeywell, Inc. v. State Board of Equalization (1975) 48 Cal.App.3d 907.
A subcontractor was a retailer of tangible personal property and not a consumer under ruling 11 (now regulation 1521) when he supplied completed door frames f.o.b. jobsite which were installed by others. Overly Manufacturing Co. v. State Board of Equalization (1961) 191 Cal.App.2d 20.
Possession by retailer.—Person who receives purchase order from consumer and who then places his own purchase order with supplier and requires supplier to ship directly to consumer is a retailer and not a broker when there is no contract between supplier and consumer. Meyer v. State Board of Equalization (1954) 42 Cal.2d 376.
Sales of equipment by a railroad.—A railroad is a "retailer" where it makes a total of 900 separate sales of tangible personal property between 1933 and 1944. Market Street Railway Co. v. State Board of Equalization (1955) 137 Cal.App.2d 87.
Installation assistance.—Sellers of precut or prefabricated materials who render some assistance to customers in installation are retailers rather than contractors. Greenblatt v. State Board of Equalization (1957) 148 Cal.App.2d 619.
Seller of building materials.—A manufacturer of wet mix concrete and asphalt, who transports such property to a jobsite and discharges it into forms, where it is spread and finished by a contractor, is the retailer of concrete and asphalt and tax applies to gross receipts of such sales. Hayward Building Material Co. v. State Board of Equalization (1958) 164 Cal.App.2d 607.
Seller of used trucks.—A manufacturer of food products for resale was the retailer of used delivery trucks and the tax applies to the gross receipts of such sales where it purchased the equity of the retiring salesmen in the used trucks and resold them to new salesmen. Frito Co. v. State Board of Equalization (1961) 192 Cal.App.2d 331.
National Bank.—A bank which sold to its depositors personalized checks was "engaged in the business" of making sales of such checks and thus was a "retailer" under this section. Bank of America v. State Board of Equalization (1962) 209 Cal.App.2d 780.
Distributor of Greeting Cards Held Retailer of Cards Sold Through Agents.—Plaintiff, a California corporation that distributed greeting cards to independent salesmen in California and other western states, sought a refund of taxes paid by it, contending that the salesmen were the actual retailers of the cards. The salesmen, who were solicited by an outof-state corporation associated with plaintiff, forwarded orders to that corporation who in turn forwarded them to plaintiff. Plaintiff mailed the cards, which were drawn from stocks acquired from its out-of-state parent corporation, directly to the salesmen. The Board had ordered that plaintiff, rather than the salesmen, be regarded as the retailer of the cards pursuant to Revenue and Taxation Code Section 6015 which provides that the Board may, for the efficient administration of the Sales Tax Law, regard salesmen as agents of the distributors "… under whom they operate or from whom they obtain the tangible personal property sold by them…" and the distributors as retailers. The trial court found that plaintiff distributed the cards to the salesmen, that the salesmen obtained the cards from plaintiff, and that the salesmen were so numerous that the Board could not effectively collect the tax directly from the salesmen. In affirming, the court held that plaintiff was not required to have an ownership interest in the cards to be a distributor. The fact that it was a subsidiary of the parent corporation and that the cards sent to the salesmen by plaintiff bore its identification in the form of a return address, and at times even contained sales literature inserted by it, was sufficient. The court noted that it was plaintiff which actually delivered the greeting cards to the salesmen, and that this act constituted the final service accorded to the salesmen by any of the tripartite entities. The court further held that plaintiff was not entitled to a refund with respect to sales which might have been made outside the state since it failed to offer any evidence as to which of its sales were made out of California. Sunshine Art Studios of California v. State Board of Equalization (1974) 39 Cal.App.3d 223.
Initial Sale.—The tax applies to the initial retail sale of a seller even though the seller was not a retailer prior to that sale. Davis Wire Corp. v. State Board of Equalization (1976) 17 Cal.3d 761.
Manufacturer of soft drinks sold through vending machines.—The court held that a manufacturer of soft drinks sold to vending machine owners and lessees was the retailer. Associated Beverage Company, Inc. v. State Board of Equalization (1990) 224 Cal.App.3d 192.
Liquidation sales by trustees in bankruptcy.—A nondiscriminatory tax on a bankruptcy liquidation sale is not barred by the now discredited intergovernmental tax immunity doctrine, and there is no longer any constitutional impediment to imposition of a sales tax or a use tax on a bankruptcy liquidation sale. The sales and use tax does not discriminate against a bankruptcy trustee or those that they deal with, and the bankruptcy trustee is not so closely connected to the federal government that the two cannot be viewed as separate entities. California State Board of Equalization v. Sierra Summit, Inc. (1989) 490 U.S. 844.